New public procurement thresholds from 1 January 2024
Public procurement thresholds are being updated, we look at the impact of this on value of Central Government, and Sub-Central Government, contracts.
The Public Procurement (Agreement on Government Procurement) (Thresholds) (Amendment) Regulations 2023 (“the Regulations”) introduce revised financial thresholds for the procurement of public contracts which are commenced on or after 1 January 2024.
What are procurement thresholds?
Where a public contract has an estimated value which exceeds the relevant threshold, contracting authorities are required to comply with the requirements of procurement regulations in order to procure such contracts.
How different do the procurement thresholds look?
The threshold amounts have generally increased very slightly, save for the Light Touch Regime which remains the same. The threshold under the Defence and Security Public Contracts Regulation 2011 also remains unchanged.
The figure below shows the new financial thresholds. Different thresholds apply to central and sub-central contracting authorities. It is important to remember that as of 16 August 2021, NHS England and NHS Foundation Trusts are classed as central government authorities.
Public Contracts Regulations 2015
| Type of Contracting Authority | Type of contract | Current thresholds (for procurements commenced on or before 31st December 2023) | New thresholds (for procurements commenced on or after 1st January 2024) |
|---|---|---|---|
| Central government bodies | Services or Goods | £138,760 (inc. VAT) | £139,688 (inc. VAT) |
| Works | £5,336,937 (inc. VAT) | £5,372,609 (inc. VAT) | |
| Light touch regime | £663,540 (inc. VAT) | £663,540 (inc. VAT) – no change | |
| Sub-central authorities | Services or Goods | £213,477 (inc. VAT) | £214,904 (inc. VAT) |
| Works | £5,336,937 (inc. VAT) | £5,372,609 (inc. VAT) | |
| Light touch regime | £663,540 (inc. VAT) | £663,540 (inc. VAT) – no change |
Concession Contracts Regulations 2016
| Current thresholds (for procurements commenced on or before 31st December 2023) | New thresholds (for procurements commenced on or before 1st January 2024) |
|---|---|
| £5,336,937 (inc. VAT) | £5,372,609 (inc. VAT) |
Utilities Contracts Regulations 2016
| Type of contract | Current thresholds (for procurements commenced on or before 31st December 2023) | New thresholds (for procurements commenced on or before 1st January 2024) |
|---|---|---|
| Services or Goods | £426,955 (inc. VAT) | £429,809 (inc. VAT) |
| Works | £5,336,937 (inc. VAT) | £5,372,609 (inc. VAT) |
Defence and Security Public Contracts Regulation 2011
| Type of contract | Current thresholds - unchanged |
|---|---|
| Services or Goods | £426,955 (inc. VAT) |
| Works | £5,336,937 (inc. VAT) |
It should be noted that these figures are inclusive of VAT.
These revised figures will only apply to procurements “commenced” on or after 1st January 2024, and the current thresholds will apply to any procurements commenced on or before 31st December 2023. A procurement is “commenced” for the purposes of the Regulations if a contracting authority has:
- published a notice inviting offers or requests to participate or negotiate or intention to hold a design contest;
- published any form of advertisement seeking offers or expression of interest; or
- contacted any economic operator in order to seek expressions of interest or offers or responded to an unsolicited expression of interest or offer received from an economic operator.
If you have any questions about the new procurement thresholds, or procurement law in general, please get in touch with out specialist lawyers.
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